The meteoric rise of online social networking has yet to be fully replicated on the mobile medium.
Any else noticed the disconnect between social networking on the internet and its rise on mobile? Wireless is no stranger to hype, but there is a surreal calm surrounding mobile social media.
Maybe it’s the business models. Subscription remains an option, even if some of the earliest subs offerings are being phased out in favour of free. Of course, it’s easier to introduce a subscription at launch than one year down the line.
As one clear-sighted operator said to me: “By not charging, you will never know if a consumer will pay for it or not.”
‘Free’ opens the door for ad-funded services. However, to truly captivate advertisers, service providers must provide meta data in addition to traffic. But, while some pureplays do collect such information, the data provided by web stalwarts like Facebook and MySpace is limited at best.
This is keeping a very low ceiling – generally less than $5 – on the CPMs that advertisers are prepared to invest, though there are examples of higher rates on more targeted offerings.
Either way, social networking site traffic is growing at an exponential rate. According to the comScore World Metrix, 580.5 million internet users (aged 15 years and older) network socially on the internet.
As of June 2008, Facebook had 132.1 million users, with MySpace at 114 million. Both are expanding fast into mobile, with the MySpace wireless base at approximately nine million in the US alone. That equates to 12 per cent of its US online user base (73 million).
But if MySpace can eventually encourage 20 per cent of its PC-based followers to embrace mobile as a complement to their PC-based experience, that would equate to 14.6 million US mobile users.
Facebook has an even larger audience. Then there are the likes of Bebo and YouTube and numerous others around the world too plentiful to mention. If the mobile industry can entice half of all social networkers on to mobile, it would connect with over 290 million users – equal to the population of the US.
The revenue possibilities are even more exciting. 290 million people paying a $3 per month subscription would generate $10.4 billion per year. Or $7.92 billion based on an ad-funded free model with a CPM of US$3 on an average of 25 page impressions per user per day. However you approach it, there is a vast untapped market just needing that little incentive to make the leap ‘over the air’.
The mobile industry has long been focused on unlocking those users who only use their device for voice and messaging. Perhaps it’s been looking in the wrong place.
There’s an army of potential mobile data users out there. They can be simply reached by typing www.facebook.com or www.myspace.com into any PC.
Nick Lane is Chief Researcher at Direct2 Mobile, which offers mobile content consultancy, and our own ME Research service. You can contact Nick at meresearch@intentmedia.co.uk.
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